U.S. House Leaders, Bush Agree on $165 Billion For Iraq War

By Nicholas Johnston and James Rowley

June 19 (Bloomberg) -- Democratic and Republican leaders in the U.S. House of Representatives reached agreement with the Bush administration yesterday on legislation to fund the wars in Iraq and Afghanistan until President George W. Bush's successor is in office.

The measure allocates about $165 billion for the wars, which will fund the conflicts until mid-2009. The compromise also includes an extension of unemployment benefits that Democrats sought and Bush had opposed, increased educational funding for returning veterans and emergency spending for states affected by recent flooding.

The House may vote on the measure as soon as today.

``This is a major victory,'' said White House Budget Director Jim Nussle. ``It meets the president's priorities'' and ``lives within'' his funding request.

The measure ``gets our troops the funding they need,'' House Republican Leader John Boehner said in a statement.

Congress has been under pressure to produce a bill -- without the troop-withdrawal measures Bush has threatened to veto -- because the Defense Department was beginning to run short of funds for the wars. The agreement also ends a series of confrontations over spending on the conflicts that began when Democrats took control of Congress last year. Since then, Bush has vetoed or Republican senators have blocked Democratic efforts to link funding to demands for the withdrawal of U.S. troops from Iraq.

No Pull Out

This legislation doesn't demand that troops pull out.

``What has been going on is the three-cornered discussions between the House, the Senate and the White House,'' House Democratic Leader Steny Hoyer told reporters yesterday. ``We're hopeful that the Senate will pass it and the president will sign it.''

Jim Manley, a spokesman for Senate Democratic Leader Harry Reid said ``we look forward to reviewing the House's complete proposal, and we will take it up quickly once we receive it.''.

The House last month rejected a plan to spend about $163 billion for the wars because of objections by Republicans angry about not being given opportunities to amend the legislation.

The House did approve a tax surcharge on individuals earning more than $500,000 per year to pay for expanded veterans' benefits. The new legislation includes the veterans' programs but removes the tax surcharge, which Bush and congressional Republicans opposed.

A war-spending bill approved earlier by the Senate included about $10 billion in additional domestic spending that was opposed by Bush, who had threatened to veto any measure that exceeds his spending request for the wars.

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